TiVo Launches New Advertising Solution; ‘Program Placement’

TiVo Inc. (Nasdaq: TIVO) announced today Program Placement, its latest advertising solution that offers advertisers an opportunity through the TiVo(R) Service to insert an ad after a program has played, when there is nothing left to fast forward through. For the first time, advertisers will be able to reach their target DVR audience by purchasing advertising enhancements against specific shows. Burger King Corporation, General Motors Corp., MasterCard Worldwide, The Weather Channel and Court TV are the first companies to take advantage of Program Placement on TiVo. Leading media and advertising agencies, including GroupM’s MindShare, Norwalk, CT-based Media Storm and GSD&M, worked with TiVo to have their clients be the first to use this revolutionary advertising solution.

Yes, TiVo is adding advertising to the system, in much the same way as TiVo Central Promos and the icons that pop up during some TV ads. As with those, this is not force fed advertising – users can choose to watch the promo or not. And it is at the end of the program, so it doesn’t interfere with watching. To highlight key points:

Program Placement advertising, inserted at the end of a recorded program for the viewer who chooses to watch it, can be matched to multiple programs, television series and genres.

I know there are some people who find all advertising offensive and would prefer a utopia of ad-free, free content that they can watch or trade to their hearts content. While that’s a nice concept, here in reality the bills need to be paid and content isn’t free.

I think TiVo has done a great job of keeping advertising unobtrusive for the user, while offering advertisers a new way to reach consumers with unique content. I’d much rather watch a few minute clip of a product I’m interested in being demonstrated than a generic 30-second spot. And if you give me the option of watching promos for things I have an interest in – like movies, DVDs, gadgets, etc – I’ll probably watch them. Heck, I enjoy the CNet TiVoCast content and that’s pretty much a long form ad for the gadgets they review. And it is certainly preferable to ads for things I have no use for. I’m a 35-year old single geek who owns his own home and drives a muscle car – I have no use for feminine hygiene products, children’s goods, AARP, or a minivan, and I don’t drink cheap American so-called ‘beer’. Which is why I love 30-second skip – I just don’t watch ads during my shows. But give me the option to watch a gadget review, or show me the latest in home improvement goods, computing, cars, etc, and I’ll very likely watch your ad. Heck, how about promos like “If you liked the show you just watched, how about these shows?” And let me watch trailers for other programs. I can see a number of uses for this.

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Are the networks and/or studios going to demand a cut of revenue that comes from tacking an ad onto the end of their show? Are they entitled to, if it’s their show that delivered the eyeballs?

megazone

Good question – but I don’t think so. Cable companies have put banner ads in their UI and they don’t pay networks for their eyeballs. And TiVo already has the pop-up links that appear over ads and they don’t pay the networks for the surrounding show which brings in the viewers.

mhaithaca

I think there’s a subtle difference between Lexus paying TiVo to tag a Lexus ad that happens to be running in “ER” for those who want more than the 30-second spot can offer, and Lexus paying to add an entirely new Lexus ad to the end of “ER” for the sake of getting “ER” viewers.

pheltzer

The big difference is that (Using your example) Lexus is using a shotgun approach hoping to reach a certain demographic by paying NBC to air a commercial during ER. As we all know thanks to DVR’s the odds of that commercial have gone down. It sounds like this new feature is TiVo saying to Lexus… “Look your target demographic is probably recording ER and fast forwarding through the commercials… slip us a couple of bills and we’ll tack your commercial on at the end, maybe let you do a little interactive spot.” This would seem to completely go around the broadcaster to me. They’re not part of this equation. The network isn’t giving up any of their airtime for this ad so they shouldn’t get compensated… of course this then runs into a huge grey area as to whether this becomes rebroadcast for commercial purposes… but that’s a whole other issue.

stile99

More Veronica Belmont. She’s funny. And cute. Less Molly Wood. She isn’t. More Brian Cooley. He’s hella funny. And cool.

mrmac14

Amen to Veronica, but Molly is ok to look at.

stile99

Oh yeah, definitely not a burden on these old eyes. Just saying she’s totally not as funny (to me) as she appears to think she is.